Maxima Corporation is a high-tech firm that produces a mass-storage system. The design of this syst

Maxima Corporation is a high-tech firm that produces a mass-storage system. The design of this syst

Feb 3rd, 2012

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Maxima Corporation is a high-tech firm that produces a mass-storage system. The design of this system is unique and represents a breakthrough in the industry. The company is completing its fifth year of operations and needs to prepare its master budget for the coming year, 2014. The budget should detail each quarter’s activity and the activity for the year in total.
The balance sheet at December 31, 2013 is as follows:
Assets
Cash $ 1,325,000
Accounts Receivable 9,600,000
Direct Materials Inventory (55,000 units) 3,850,000
Finished Goods Inventory (12,500 units) 4,650,000
Plant, Property and Equipment, net of
Accumulated Depreciation 38,650,000
$58,075,000
Liabilities and Stockholders’ Equity
Accounts Payable $ 6,350 ,000
Capital Stock 27,000,000
Retained Earnings 24,725,000
$58,075,000
The following additional information is provided:
a)